Thursday, December 6, 2018
Intercontinental Hotel Saigon, Ho Chi Minh
Good afternoon. Acting Assistant Secretary Ian Steff, distinguished guests, ladies and gentlemen, it is an honor to be here and speak at this important seminar focused on opportunities for U.S.-Vietnam cooperation in Vietnam’s LNG sector.
I’d like to take a moment to remember the life and legacy of President George Herbert Walker Bush. As President Trump noted, “President Bush led a great American life, one that combined and personified two of our Nation’s greatest virtues: an entrepreneurial spirit and a commitment to public service. Our country will greatly miss his inspiring example.” Yesterday, December 5, was a National Day of Mourning in the United States to recognize the contributions of this great leader.
Now, as we assess the present and look to the future, the U.S.-Vietnam relationship has never been stronger. Indeed, I am here today to affirm my government’s dedicated support in assisting Vietnam to meet its energy goals. As you have seen throughout the day, I am leading a talented team of experts from across the U.S. government to implement a new U.S. initiative entitled: “Asia Enhanced Development and Growth through Energy” or “Asia EDGE.”
As you know well, Vietnam’s energy market growth represents a great opportunity for U.S. energy and energy-related exports – in particular, advanced energy technologies and liquefied natural gas. Asia EDGE brings together government and private sector resources to help grow sustainable and secure energy markets across the Indo-Pacific region. Asia EDGE aims to catalyze – not replace – private sector investment.
Here in Vietnam, we will advance our bilateral cooperation under the banner of EDGE Vietnam. EDGE Vietnam will look to capitalize on the tremendous opportunity to strengthen energy security with modern technologies that are clean, smart, and state-of-the-art!
Energy policy and associated decisions are not always easy. Like my country and many others, Vietnam has important – and difficult – decisions to make about its energy sector in the near future. The investment choices Vietnam makes will impact its energy security, its environmental quality, and its ability to sustain its incredible economic growth for generations to come.
Vietnam is on the cusp of an energy sector transformation that can lessen its dependence on antiquated and harmful coal-fired systems and rapidly deploy modern, clean energy technologies including solar, wind, and natural gas. Vietnam is blessed with abundant solar and wind energy resources, especially in the south where energy demand is high and growing.
However, we know these renewable sources are variable in nature, producing power only when the sun is shining and the wind is blowing. It is critical for Vietnam to plan for and invest in a diverse and well-synchronized energy system, drawing upon a variety of generation technologies and supported by a smart and resilient grid. In support of this goal, nimble and responsive natural gas power perfectly complements and balances the variable nature of Vietnam’s solar and wind resources.
I learned recently that demand for electricity in Vietnam is expected to increase at around eight percent per year over the next decade, as the economy continues its rapid growth. In addition, around a quarter of Vietnam’s electricity production currently comes from gas-fired thermal generation, with coal and hydropower representing approximately 36% each.
I can say with confidence, based on my meetings with the Vietnamese government leaders, that Vietnam is very interested in increasing electricity production from natural gas. And that is the reason why we are here today.
This seminar is an opportunity for Vietnam’s project owners to present plans for energy development to some of the best U.S. firms in this sector.
In turn, U.S. companies can share best practices with Vietnam about lifecycle costing, LNG infrastructure development, and infrastructure financing through public-private-partnerships.
I am honored to be joined today by world-class natural gas sector experts from companies including AES, Alaska Gasline Development Corporation, Cheniere, Energy Capital Vietnam, Excelerate Energy, ExxonMobil, and Marsh. All are keen to invest in, and work with, Vietnam to realize its potential in this important and growing sector.
I want to stress the importance of building on the momentum we have created. Projects and initiatives like those from AES, Alaska Gasline Development Corporation, Cheniere, Excelerate Energy, and Exxon Mobil are at the core of EDGE Vietnam and what we hope to accomplish here today. These projects are more than just a timely solution to ensuring Vietnam’s energy security and meeting its growing energy demand. They also represent the powerful potential of energy cooperation between our two countries.
Let me speak for a moment about the bigger picture for that cooperation:
The economic vision of the President’s Indo-Pacific Strategy focuses on enabling private firms to build infrastructure financed by private capital. We think this is exactly what Vietnam needs, in light of its prudent cap on government borrowing.
Together with the private sector, the Asia EDGE platform will support the critical development of regional energy infrastructure and help create open, efficient, and transparent energy markets. That is the regional context for EDGE Vietnam.
Right here, under EDGE Vietnam, the U.S. government is providing a wide range of support both monetarily and in the form of expertise and capacity building:
The U.S. Trade & Development Agency has granted Vietnam millions of dollars to conduct feasibility studies related to wind power, smart grids, and battery storage, just to name a few. In fact, earlier today, USTDA announced a feasibility study grant in support of Electricity Vietnam’s development of an LNG terminal here in southern Vietnam. Grants like these assist with site selection and evaluation, while also helping assess the planning and use of LNG as a fuel source for power and effective development of the energy infrastructure.
The United States Agency for International Development is helping Vietnam develop Power Development Plan #8, helping establish the country’s path to energy security. In addition, USAID is also working with Vietnam to design the country’s first direct power purchase agreement mechanism that will allow private parties to directly enter into a contract for the procurement of renewable energy.
The Department of State’s Bureau of Energy Resources is providing expert exchanges and analysis to help Vietnam with energy sector reform to ensure its energy security.
The Department of Energy is arranging for experts from our national energy labs to advise Vietnam on power plant management.
The Overseas Private Investment Corporation intends to help finance LNG projects and initiatives like the ones I mentioned earlier.
And, of course, our team at the U.S. Commercial Service helps bring together the public and private sector by creating and organizing programs like the one here today.
EDGE Vietnam is our vision that, together, we can boost Vietnam’s energy efficiency, improve air quality, and decrease the need for imported coal. That means greater competitiveness for industry, greater energy security for the nation, and a better quality of life for the Vietnamese people.
This past March, the U.S. Mission to Vietnam co-hosted the first U.S.-Vietnam Energy Security Dialogue with the Ministry of Industry and Trade in Hanoi to diversify Vietnam’s energy supply, reform electricity tariffs, and promote clean and renewable energy.
Today I am excited to preview the second U.S.-Vietnam Energy Security Dialogue that will take place next Spring in Washington, DC.
I look forward to formally extending an invitation to the Ministry in the coming weeks to participate in this event.
I wish all of you a productive workshop today. Your discussions and your work are an essential part of the continual development of the strong and important relations between our two countries, unlocking new ways to work together and strengthen our comprehensive partnership.